Ethereum (ETH) has stabilized above $3,000 following a sharp sell-off earlier this week as large holders increased their exposure during the decline. The recovery follows a volatile period in which ETH briefly dipped below a key technical level, triggering liquidations and sparking renewed caution in the broader cryptocurrency markets.
On January 22, Ethereum was trading at around $3,003, up about 1.3% in 24 hours. This rebound comes after ETH fell nearly 13% between January 19 and 21, reaching $2,900 for the first time in four weeks.
This decline coincided with increased macro uncertainty, ETF outflows, and the liquidation of more than $480 million in bullish leveraged positions.
ETH's price trends to the downside on the daily chart. Source: ETHUSD on Tradingview
Contrast cautious positioning and Ethereum accumulation
On-chain data shows that large Ethereum holders have been accumulating aggressively during the recent recession. The whale balance increased by approximately 290,000 ETH over the two days, meaning a purchase worth close to $360 million at current prices.
This behavior suggests that some long-term investors see the recent decline as a buying opportunity. However, other indicators suggest that experienced traders are taking a more cautious stance.
The smart money index remains below its signal line, a level it has historically crossed ahead of a stronger upward move. In previous instances, such confirmations would have preceded double-digit gains, but so far no such signal has emerged.
Derivatives data supports this wait-and-see approach. ETH perpetual futures funding rates briefly turned negative, indicating decreased confidence among leveraged traders. The options market has also seen increased demand for downside protection after repeated rejections near the $3,400 level over the past two months.
The technical structure highlights a tight trading horizon.
From a technical perspective, Ethereum is trading within a symmetrical triangle on the daily chart.
The momentum indicator shows a bullish divergence. The Relative Strength Index saw prices make lower lows between November and mid-January, while the Relative Strength Index made higher lows. This pattern, although lacking confirmation, suggests that selling pressure may be waning.
On the upside, the immediate level to watch is $3,050. This is a previous support area that ETH lost during the recent sell-off. A sustained daily close above this level would indicate near-term stability.
The $3,146 to $3,164 range above it represents a dense supply area with approximately 3.4 million ETH accumulated. This region is expected to act as a strong resistance force.
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On the downside, failure to hold the lower boundary of the triangle near $2,910 could open the door for a deeper move towards the $2,610 support area.
ChatGPT, ETHUSD chart cover image by Tradingview
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